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Finance in the Hospitality Industry Essay Example

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Finance in the Hospitality Industry

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Finance in the Hospitality Industry. The credit sales opportunity, the hotel and the equipment manufacturer will also get the opportunity of establishing long run business relationship with each other. Given the goodwill of the hotel on the basis of its regularity to pay back the credited amount this relationship may yield significant advantages to aid the financial needs of the organisation further adding to its financial health. Thus, the purchase technique can also be recognised as a major contributor of generating income for both the business bodies. From a generalised point of view, it can therefore be stated that large government as well as private investment organizations may also be used to collect funds from within the hospitality industries in such a manner that in terms of contribution, both the hospitality organizations and the investment bodies get benefitted (University of Nebraska, 2007).

For a large chain of restaurant, outsourcing of the supply chain and logistics processes may also be regarded as a major funding source for the local or global logistics organizations, which may be useful to facilitate savings in the organisation. These savings can in turn be used as a vital source of finance by the company. Correspondingly, inter-organizational investment has now become a common trend within majority of the organizations. It is principally owing to the fact that the contribution benefits for all the participating bodies persists as vast in terms of lower risks, lesser liabilities, adequate cash inflows, improvised liquidity aspects and financial stability rates among others (Hsyndicate, 2014).In accordance with the case example, the elements associated with costs can be differentiated into two main categories; viz., direct cost and indirect cost. Direct costs generally refer to the expenditure factors for an organization that are rigid to be controlled and managed easily. In the given case scenario, labour expenses, electric bills, machinery and maintenance can be identified as the elements of direct costs. Correspondingly, indirect costs can be referred as the expenditure resulting from those variables that can be controlled with minimum or no changes in the production process (Slide Share Inc. For instance, preventing the unnecessary use of electricity and setting up of alarm systems for preventing thievery attempts can bring about reduction in the levels of indirect cost within the organization.Correspondingly, the concept of gross profit percentage can be. Finance in the Hospitality Industry.

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Accounting For Management, 2014. Gross Profit Ratio (GP ratio). Financial Statement Analysis/Accounting Ratios Analysis. [Online] Available at: http://www.accountingformanagement.org/gross-profit-ratio/ [Accessed July 11, 2014].

Accounting-Simplified.com, 2010. How to Prepare a Trial Balance. Financial Accounting. [Online] Available at: http://accounting-simplified.com/preparing-trial-balance.html [Accessed July 11, 2014].

CEES, 2014. College Of Education and External Studies. Chapter One. [Online] Available at: http://cees.mak.ac.ug/sites/default/files/publications/12345printout2.pdf [Accessed July 11, 2014].

Forbes.com LLC, 2014. 5 Ways To Control Costs. Entrepreneurs. [Online] Available at: http://www.forbes.com/sites/steveodland/2012/02/15/5-ways-to-control-costs/ [Accessed July 11, 2014].

Hsyndicate, 2014. Hospitality Industry Sources Of Funding To Be Put Under the Microscope at Hospace 2013. Home. [Online] Available at: http://www.hsyndicate.org/news/4062809.html [Accessed July 11, 2014].

Mansueto Ventures, 2014. Fixed and Variable Expenses. Inc. [Online] Available at: http://www.inc.com/encyclopedia/fixed-and-variable-expenses.html [Accessed July 11, 2014].

Slide Share Inc., 2014. Elements of Cost. Presentation Transcript. [Online] Available at: http://www.slideshare.net/Rakshithabharani/elements-of-cost [Accessed July 11, 2014].

Sebastian, K. H. & Maessen, A., 2010. How to Manage Higher Cost, Inflation and Collapsing Margins. Fluctuating Raw Material Prices, pp. 1-6.

University of Nebraska, 2007. Credit Advantages, Disadvantages and Common Types. Neb Guide. [Online] Available at: http://www.ianrpubs.unl.edu/pages/publicationD.jsp?publicationId=913[Accessed July 11, 2014].

Voluntary Action Cumbria, 2006. Start Your Own Business. Business Viability, pp. 1-16.

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